It has been one year since Facebook announced it was rebranding as Meta, and since then, the Metaverse has shown everyone a whole new meaning of online shopping. Brands have gotten innovative and created virtual storefronts and even dabbled in virtual reality for consumers to try on certain products.
- A Safe Space for Cannabis Brands
- How This Cannabis Brand is Utilizing the Metaverse
- Advertising Through the Metaverse vs. Traditional Advertising
- Beware of Cryptocurrency in the Metaverse
- Tips for Cannabis Businesses to Navigate the Metaverse
A Safe Space for Cannabis Brands
Even though cannabis businesses have had a difficult time with traditional marketing methods, the Metaverse presents a plethora of new opportunities for the industry. “It is allowing brands, growers, and business owners to reach an audience they may not have otherwise been able to communicate with. They can showcase their products in a space that is safe. The Metaverse is designed for people to be free in terms of how they spend their money or time, post, or advertise, so when retailers are able to create these worlds and introduce others into their universe, the products can actually exist there in a safe space,” Marlo Richardson, creator of Braymar Wines and CEO and founder of cannabis brands Tremendo, Just Mary, and Greenwood & Co, LLC, said.
The Metaverse technology has the potential to transform the business processes of the cannabis industry. According to Aarti Dhapte, Senior Research Analyst at Market Research Future, cannabis companies can use the Metaverse to set up shops, promote their core product, expand brand awareness and ecommerce presence, launch an actual dispensary, and sell real-world merchandise.
How This Cannabis Brand is Utilizing the Metaverse
ACS Laboratory, the largest hemp and cannabis testing facility in the eastern U.S., recently announced its entrance into Decentraland’s Automatic Slims Metaverse Marketplace. Powered by blockchain company, Blockticity, Automatic Slims is a virtual Metaverse Marketplace featuring four floors of dynamic experiences merging retail, education, and entertainment. Visitors can find ACS Laboratory on the first floor, where they can leisurely explore the 3D lab or take ACS Laboratory’s Cannabis Quest to learn about the industry and redeem real-world prizes.
On the laboratory floor, Slims visitors will discover ACS Laboratory’s instruments and learn how to read test results from Blockticiy-verified Certificates of Analysis (COAs). In the process, they will realize how hemp and cannabis compounds synergize to create the unique strains and products they love. Those who embark on the Cannabis Quest will answer pop quizzes, earning virtual prizes when they complete the journey.
“The Metaverse is a new and exciting medium for cannabis users to learn more about products, how they affect their body, and how finished goods are made. We are proud to be part of the cannabis Metaverse community and look forward to harnessing this medium for cannabis compliance,” ACS Laboratory President and CEO Roger Brown said.
Advertising Through the Metaverse vs. Traditional Advertising
According to Dhapte, there is a significant difference between Metaverse and traditional marketing. The Metaverse is the next-level marketing platform where cannabis companies can promote their products more openly than other platforms. Although cannabis is legal in some countries, consuming it in public is not.
However, while in the Metaverse and in the comfort of the user’s home, cannabis brands could host virtual tastings to launch new products. Cannabis marketers might be able to talk up their merchandise more freely than they can on platforms such as Facebook (Meta) or other existing traditional platforms. Cannabis marketers can provide a personal social experience and build brand loyalty.
Even though the Metaverse presents a wider variety of marketing methods than traditional advertising channels, dispensaries and brands should still air on the side of caution. “Cannabis brands looking to engage with the Metaverse should generally be following the same guidelines applicable to advertising and sales on traditional websites,” Habeeb Syed, Senior Associate Attorney at Vicente Sedereberg LLP, said. “The best way to make sure you are properly engaging with the Metaverse is to consult with an attorney or compliance professional as you open a store in the Metaverse, kick off an advertising campaign, or sell an NFT.”
Beware of Cryptocurrency in the Metaverse
Despite vast support for this convergence by industry professionals, Brett Puffenbarger, Vice President of Marketing for Green Check Verified‘s Cannabis Division, says that Web3 platforms and digital currency are complicating the cannabis banking space. As it is, cannabis banking is a sensitive topic, and it is a high risk vertical with a regulatory burden.
“Fifteen years from now, this could be the solution, but this is cannabis where things happen fast in the present,” Puffenbarger said. “We do not have that extra bandwidth as cannabis operators to worry about 30 years down the road. We need to worry about six months down the road and how we pay our vendors today. We might not have the perfect fix now, but let us not add an extra layer of complexity to solve a seemingly basic problem.”
According to Peter Su, SVP of Green Check Verified, there’s a FinCEN advisory rule known as the travel rule in which regulators expect licensed, regulated financial institutions to know where each dollar came from and where that dollar is going. If you layer in cryptocurrency, it is possible to anonymize this information and/or for it to be false with a fake identity or email address connected to it. For cannabis brands who are just getting started in the Metaverse space, it may be best to stick with traditional payment methods until it becomes federally legal or better banking regulations are set in stone.
Tips for Cannabis Businesses to Navigate the Metaverse
Dhapte offers the following advice for brands who are looking to get their feet wet in this increasingly popular marketplace:
- Cannabis companies should consider the individual advertising and marketing regulations of the particular region they operate.
- Cannabis brands should observe legal regulations, including not serving users in countries where the product is prohibited.
- Cannabis businesses should not entirely rely on the Metaverse technology since the technology is still in the development phase. The complexities and uncertainties associated with the Metaverse should go away within the next few years, and then cannabis brands will be able to utilize the technology to its full potential.
“Just start researching. In the beginning, it might seem like this complex thing, but really it is just made up of individuals and community members like you and me,” Bryan McLaren, CEO and Chair at Zoned Properties, said. “Start reading and talking about it, and interact directly with the Metaverse and virtual reality. It will direct you to service professionals that understand the technical aspects of entering that environment safely and how to properly position yourself.”
Probably some of the best advice that cannabis businesses can take from this article is to consult with professionals before doing anything in the Metaverse. Whether that be through other brands in the industry or through a hired professional, talk your ideas out to someone else and let the inspiration flow.